Gross profits in the first six months of 2020 increased 38.4% to $127.0 million compared to the same period of 2019 as gross margins increased to 13.2% compared to 11.3% for the same period of 2019. The impact of higher lumber prices contributed to a 10 basis point decline in our gross margin. Improvements in our profitability were primarily due to the impact of effective inventory positioning resulting in lower lumber costs, favorable changes in product mix, and strong organic growth which allowed us to leverage fixed costs, and the sequential rise in lumber prices in the second quarter which favorably impacted our gross profit per unit of products sold on a variable price such as ProWood pressure-treated lumber.
Selling, general and administrative (“SG&A”) expenses increased by approximately $8.5 million, or 14.4%, in the first six months of 2020 compared to the same period of 2019, while we reported a 17% increase in unit sales. Acquired operations since the second quarter of 2019 contributed approximately $1.6 million to this increase. Accrued bonus expense increased approximately $4.2 million and totaled approximately $11.9 for the first six months of 2020. The remaining increase was due to increases in salaries and wages and in-store merchandise offset by a decline in advertising and other costs.
Earnings from operations for the Retail reportable segment increased in the first six months of 2020 compared to 2019 by $26.6 million, or 79.9%, well in excess of our 17% increase in unit sales as a result of the factors mentioned above.
Industrial Segment
Net sales in the second quarter of 2020 decreased 23% compared to the same period of 2019, due to a 27% decrease in unit sales due to the impact of the pandemic, offset by a 4% increase in selling prices due to the Lumber Market.
Gross profits decreased by 17.3% to $37.2 million for the second quarter of 2020 compared to the same period of 2019 due to the decline in unit sales. However, gross margin increased to 16.6% from 15.4% for the same period last year. We estimate the higher level of lumber prices (see “Impact of the Lumber Market on Our Operating Results”) caused a decline in margin of 90 basis points. The remaining improvement in our profitability was primarily due to the impact of effective inventory positioning resulting in lower lumber costs and favorable improvements in our sales mix.
Selling, general and administrative (“SG&A”) expenses decreased by approximately $2.6 million, or 10.7%, in the second quarter of 2020 compared to the same period of 2019. Acquired operations since the second quarter of 2019 contributed approximately $0.5 million to our costs. Accrued bonus expense, which varies with our pre-bonus operating profit and return on investment, decreased approximately $2.9 million, and totaled $2.2 million for the quarter.
Earnings from operations for the Industrial reportable segment decreased in the second quarter of 2020 compared to 2019 by $5.3 million, or 25.5%, due to the factors discussed above.
Net sales in the first six months of 2020 decreased 15% compared to the same period of 2019, due to a 14% decrease in unit sales due to the impact of the pandemic and a 1% decline in selling prices.
Gross profits in the first six months of 2020 declined 9.7% to $79.5 million compared to the same period of 2019, while gross margins increased to 16.5% compared to 15.5% for the same period of 2019. We estimate the impact of the Lumber Market contributed 20 basis points to our improvement in gross margin. The remaining improvement in our gross margin was primarily due to the impact of effective inventory positioning resulting in lower lumber costs and favorable changes in product mix.
Selling, general and administrative (“SG&A”) expenses decreased by approximately $1.0 million, or 2.0%, in the first six months of 2020 compared to the same period of 2019. Acquired operations since the second quarter of 2019 contributed approximately $0.9 million to total SG&A expenses. Accrued bonus expense decreased approximately $3.4 million compared to the same period of 2019 and totaled approximately $9.8 for the first six months of 2020. This decrease was partially offset by increases in salaries and wages, sales compensation, and amortization expense.